Views on Standard Life Aberdeen shares?

Hal17

Thanks bowled99, really appreciate you taking the time to explain that to me. That was really helpful.

Wildsound

digannio wrote: »

One thing that Standard Life will have to sort out is its disastrously under-performing giant Gars fund which has been shedding billions but still stands at around £17bn. Its five-year performance is a grand total of 5% and over the past three years it stands at -6.3%. It's an important fund for the company but shrinking by the month.

I agree, the fund has essentially turned into an expensive 40% multi asset fund 60% seemingly random market betting club whose bets have not paid off. This doesn't just have a negative effect on this fund, but also a lot of their multi asset solutions like their Myfolio range which is heavily invested in the fund (no surprise). The sheer stubbornness of the fund manager to not revamp the strategy of the fund is going to have some severe consequences to not only the fund, but to Aberdeen Standard Life as a whole. I think a lot of good IFAs will be seriously considering ditching the Myfolio range in favour of a better performing solution, at least until ASL get their house in order and start some serious reform.

The absolute return sector is in serious need of reform also though. I think a lot of these kinds of funds have some serious flaws. From a portfolio making point of view, you need your absolute return fund to be as negatively correlated to your portfolio as possible to help mitigate downside risk. At the moment, a lot of the funds seem to be just expensive, poor performing multi asset funds which are positively correlated to the rest of your portfolio.

short_butt_sweet

Wildsound wrote: »

I agree, the fund has essentially turned into an expensive 40% multi asset fund 60% seemingly random market betting club whose bets have not paid off.

whereas when the fund was doing well, it was the same thing except that the bets had paid off

This doesn't just have a negative effect on this fund, but also a lot of their multi asset solutions like their Myfolio range which is heavily invested in the fund (no surprise). The sheer stubbornness of the fund manager to not revamp the strategy of the fund is going to have some severe consequences to not only the fund, but to Aberdeen Standard Life as a whole.

revamp the strategy? if you mean: try some different random bets, then certainly they can try that. and presumably are doing.

I think a lot of good IFAs will be seriously considering ditching the Myfolio range in favour of a better performing solution, at least until ASL get their house in order and start some serious reform.

The absolute return sector is in serious need of reform also though. I think a lot of these kinds of funds have some serious flaws. From a portfolio making point of view, you need your absolute return fund to be as negatively correlated to your portfolio as possible to help mitigate downside risk. At the moment, a lot of the funds seem to be just expensive, poor performing multi asset funds which are positively correlated to the rest of your portfolio.

IMHO, the whole "absolute return" sector is best avoided. there's no magic way to get positive returns regardless of the direction of markets. being multi-asset is a good way to control how much risk you're prepared to take. random bets are just random. high charges always reduce returns. and "absolute return" is often opaque about what kind of random bets may be taken, which makes it unclear exactly what risk level a fund may be at, or how it will correlate with the rest of your portfolio.

letspretendforaminute

I'm a holder of SLA relative to its piers the company is cheap but then their funds are expensive by comparison so they need decide on their offering or suffer and that's priced in. I took my £1087 that was returned yesterday and increased my stake in HSBA. It's an average size position for me now and I'm comfortable with that.